Reliance Industries’ Value Surges After Acquisition Announcement
Reliance Industries saw a boost in its share value on Thursday following the news of its decision to acquire Paramount Global’s stake in Viacom18 Media for a significant amount. The conglomerate revealed that it would be purchasing Paramount Global’s stake in Viacom18 Media for ₹4,286 crore, which is approximately $570 million.
This acquisition will result in Mukesh Ambani’s Reliance Industries increasing its ownership in Viacom18 to 70.49% from the current 57.48% through Compulsorily Convertible Preference Shares. Despite the sale, Paramount Global will continue to supply content to Viacom18. The move, which is subject to regulatory approval, is part of a broader strategy that excludes related parties.
This announcement comes on the heels of the recent declaration of a merger between Reliance Industries and Disney in February. The merger aims to create a titan in the Indian entertainment sector with a valuation of ₹70,000 crore, or roughly $9.3 billion. The merger is expected to be completed between the last quarter of 2024 and the first quarter of 2025. Post-merger, Reliance will own 16.34% while Viacom18 will hold a 46.82% stake in the newly formed entertainment behemoth.
Paramount Global is also in the process of shedding assets, including its Simon & Schuster publishing wing, as part of a larger strategy to reduce its debt burden.
Overall, the acquisition of Paramount Global’s stake in Viacom18 Media represents a strategic move by Reliance Industries to strengthen its presence in the entertainment sector and expand its portfolio of assets. The company’s proactive approach to mergers and acquisitions demonstrates its commitment to growth and diversification in the rapidly evolving media landscape.
As investors eagerly await further developments, it will be interesting to see how these strategic moves play out for Reliance Industries and its stakeholders in the coming months.
